If the government used the revenue from the excise tax on alcohol to fund research on alcoholism treatment programs, this would be an example of
A. a vertical equity tax.
B. a benefits-received tax.
C. an ability-to-pay tax.
D. a user fee.
Answer: B
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The substitution effect from a fall in the price of a gallon of gasoline is shown in the above figure by the movement from
A) point A to point C. B) point A to point B. C) point B to point C. D) point A to point B and then to point C.
What is meant by the term "long-run competitive equilibrium?
What will be an ideal response?
Maximizing surplus in a market depends not only on the amount bought and sold, but also on:
A. how productive the sellers are. B. who buys and sells it. C. what those consumers do with it. D. None of these statements is true.
If a monopoly firm is at a level of output where MC equals $10 and is increasing, MR equals $10, and average variable cost equals $9 . To maximize profits, the firm should: a. increase both output and price
b. increase output but decrease the price. c. decrease output and increase the price. d. not change either the output or the price.